Gap Seen Emerging in Enterprise B2B Integration

By Editorial Staff On Mar 28, 2008

Seattle — March 28, 2008 — A gap is emerging between e-business strategy and execution because enterprises are not properly equipped to unlock the true potential of B2B to achieve their e-business goals and develop tighter relationships with customers and suppliers, according to a new study from B2B connectivity specialist Hubspan.

Hubspan's MarketInsight study asked respondents to identify who "owns" e-business in their organization and any challenges that exist with B2B integration. Respondents were also asked what steps are being taken to address these challenges. The study surveyed 75 companies across North America with annual revenue between $200 million and $1 billion. Respondents held a variety of positions, ranging from sales to IT to the C-suite.

The survey overwhelmingly identified IT as the primary lead for e-business. According to the study, 90 percent of enterprises rely on IT to drive e-business strategy and B2B integration. Interestingly, 5 percent of respondents could not identify a formal e-business strategy within their organization.

The survey revealed that 65 percent of respondents experience failed data exchanges among e-business trading partners. On average, 14 percent of all data exchanged fails, requiring some form of manual workaround. In some cases, manual workarounds were required on as much as 60 percent of all exchanged data. Although manual workarounds were prevalent, many respondents accepted the practice as a way to conduct business, looking no further for an automated solution.

"The complexity in e-business comes from taking two or more different company's internal systems and connecting them to share information," said Robert Pease, vice president of marketing for Hubspan. "In most cases, IT is responsible for the transmitting data, but not for that data actually being received once it leaves the company's four walls."

Taken in context, the 14 percent failure rate significantly delays important documents like incoming orders and outgoing invoices. This delay directly affects revenue, increases costs and reduces profits due to the effort required to address the exceptions. For example, a $250 million company experiencing a 14 percent failure rate could experience $35 million in delayed order revenue or invoice payments, not to mention the resource costs incurred to address them.

"The MarketInsight study makes it clear that companies do not have the technologies or processes in place to unlock the true potential of B2B integration," continued Pease. "This creates a gap in e-business strategy that prevents companies from creating true business connections, increasing revenue, and developing a competitive advantage."